You Have Located the Following Information on Rock Company: Debt

question 18

Multiple Choice

You have located the following information on Rock Company: debt ratio = 40 percent, capital intensity ratio = 2.25 times, profit margin = 8 percent, and dividend payout ratio = 25 percent. What is the sustainable growth rate for Rock?

• A) 3.56 percent
• B) 6.00 percent
• C) 4.65 percent
• D) 8.00 percent

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Definitions:

Liability

Legal responsibility for one's actions or the obligation to compensate for harm caused to others, enforceable by civil legal processes.

Authenticity

The quality of being genuine, true, or accurate, not counterfeit or copied.

Correctness

The degree to which a system or component is free from faults in its specification, design, and implementation.

Accuracy Issues

Refers to problems or discrepancies in the correctness or precision of data, results, or measurements.